The Central Bank of Sri Lanka (CBSL) has issued a stern warning that all transactions between residents must be conducted exclusively in Sri Lankan Rupees, in accordance with the Central Bank of Sri Lanka Act No. 16 of 2023.

The Bank highlighted recent instances where residents have been conducting local transactions in foreign currency and clarified that merchants are not authorized to accept payments into Foreign Currency Accounts, including through credit or debit cards.

The Central Bank emphasized that any resident who makes payments in foreign currency to a local merchant, or any merchant who accepts such payments without proper authorization, commits an offense under the CBSL Act. 

Penalties for violations can include fines of up to Rs. 25 million, imprisonment for up to three years, or both.

The Central Bank urged the public and business community to strictly comply with these regulations to avoid severe legal repercussions.